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DECREE No

DECREE No. 116-CP ON THE 5TH OF SEPTEMBER, 1994 OF THE GOVERNMENT ON THE ORGANIZATION AND ACTIVITIES OF ECONOMIC ARBITRATION

THE GOVERNMENT

Pursuant to the Law on Organization of the Government on the 30th of September 1992;

At the proposal of the Minister of Justice,

DECREES:

Chapter I

GENERAL PROVISIONS

Article 1.- Economic arbitration is a social-professional organization authorized to settle disputes concerning economic contracts; disputes between the company and its members, and among the members of a company, on the establishment, operation and dissolution of the company; and disputes concerning the buying and selling of shares and bonds.

Article 2.-

1. Economic arbitration is organized in the form of Centers of Economic Arbitration.

2. The organization and operation of each Center of Economic Arbitration shall be stipulated by its Regulations conforming to this Decree and other relevant statutory provisions.

Article 3.-

1. The sides involved can choose by mutual agreement a Center of Economic Arbitration to settle their dispute, no matter where their office is based or where they reside.

2. A Center of Economic Arbitration shall accept applications for settling economic disputes as stipulated in Article 1 of this Decree, only if before or after the dispute occurs, the sides have reached mutual written agreement on the choice of that Center of Economic Arbitration for settling their dispute.

Article 4.- An economic dispute can be settled by an Arbitration Council composed of three Arbitrators, or by one Arbitrator.

Article 5.- The decision made by a Center of Economic Arbitration (hereunder referred to as the arbitrators' decision) for settling a dispute is effective, without protest.

Article 6.- The Arbitrators in settling economic disputes must observe the objective truth, be impartial, and act in accordance with law.

Chapter II

ORGANIZATION OF CENTERS OF ECONOMIC ARBITRATION

Article 7.-

1. A Center of Economic Arbitration can be established only when there are at least five Arbitrators who are its founding members.

2. An application for the founding of a Center of Economic Arbitration must be sent to the People's Committee of the province or city under the Central Government (hereunder referred to as the provincial People's Committee), where the Center of Economic Arbitration intends to base its office.

3. An application for the founding of a Center of Economic Arbitration must specify the following:

a/ The full names, occupations and addresses of the Arbitrators who are founding members;

b/ The field of activity of the Center of Economic Arbitration;

c/ The place where the Center of Economic Arbitration intends to be based.

4. The application must be enclosed with:

a/ Draft Statute of the Center of Economic Arbitration;

b/ List of Arbitrators;

c/ Resumes of the founding members certified by the People's Committee of the ward, commune or township where they reside permanently;

d/ Photocopies of the Arbitrators' Cards.

Article 8.-

1. Vietnamese citizens residing in Vietnam who meet the following conditions can be recognized as Arbitrators:

a/ They must be recognized as virtuous, honest, impartial and objective;

b/ They must have knowledge and experience in the field of law and economics.

2. Those who have mental disorder, who have been sentenced to imprisonment, or whose sentence has not yet been revoked, or who are being prosecuted for their penal liability, shall not be made an Arbitrator.

3. A juror and procurator cannot be at the same time an Arbitrator.

4. The Minister of Justice shall decide the establishment of a Council to consider and select Arbitrators, and stipulate the procedures to consider and select Arbitrators and issue Arbitrators' Cards, at the proposal of the Council to consider and select Arbitrators.

Article 9.-

1. The Ministry of Justice is a Government agency exercising the function of State management of the activities of the Centers of Economic Arbitration throughout the country.

2. The Justice Office shall have to help the President of the provincial People's Committee manage the organization and activities of the local Center of Economic Arbitration, including:

a/ Receiving applications for the establishment of the Center of Economic Arbitration, and submitting them to the President of the provincial People's Committee for consideration and decision;

b/ Making regular reports on the activities of the Center of Economic Arbitration, and proposing to the President of the provincial People's Committee to decide measures to manage the organization and activities of the Center of Economic Arbitration;

c/ Considering requests of the Center of Economic Arbitration and of Arbitrators, and submitting them to the President of the provincial People's Committee for solution;

d/ Proposing to the President of the provincial People's Committee to issue a decision for suspension of the operation and withdrawal of the license of the Center of Economic Arbitration, in case the Center of Economic Arbitration commits serious breach of law;

e/ Proposing to the Minister of Justice to issue a decision for withdrawal of Arbitrators' Cards in case the Arbitrators make serious breach of law.

Article 10.-

1. Within 45 (forty five) days from the day when he/she receives a full valid dossier, the President of the provincial People's Committee shall have to consider and decide whether to grant, or not to grant, a license for the establishment of a Center of Economic Arbitration, after consulting with the Minister of Justice; in case of refusal, he/she must notify the applicant of the reason.

2. A license for the establishment of a Center of Economic Arbitration must specify clearly:

a/ The full names of the Arbitrators who are founding members;

b/ The address of the Office; the name of the Center of Economic Arbitration.

c/ The field of activity of the Center of Economic Arbitration.

3. The license is valid for five years. When the license expires, if the Center of Economic Arbitration wants to continue its operation, it must apply for extension of the license.

4. In granting a license, the President of the provincial People's Committee shall also ratify the Statute of the Center of Economic Arbitration.

Article 11.-

1. A Center of Economic Arbitration has a President and a Vice-President elected by the Arbitrators.

2. The President of a Center of Economic Arbitration shall appoint a Secretary of the Center.

3. The organizational Structure of a Center of Economic Arbitration, the tasks, powers, responsibility and tenure of the President and Vice-President shall be stipulated by the Center's Statute.

Article 12.-

1. A Center of Economic Arbitration shall cease its operation when:

a/ The duration written in the license expires;

b/ The conditions mutually agreed on in the Statute are effective;

c/ The Center has not been able to fill any vacancy in the required number of five Arbitrators within six months after such vacancy is announced.

d/ The Center's license is revoked.

2. When the Center of Economic Arbitration ceases its operation, it must return the license to the license-issuing agency.

Chapter III

PROSECUTION BY ECONOMIC ARBITRATORS

Article 13.-

1. When requesting the Center of Economic Arbitration to settle a dispute, the plaintiff must send to the Center a paper indicating the sides' agreement to bring the dispute to that Center for settlement.

The request must have the following contents:

a/ The date, month and year when the request is made;

b/ Names and addresses of the sides;

c/ Name of the Center of Economic Arbitration which is requested to settle the dispute;

d/ Brief resume of the dispute, and proposal for settlement;

e/ The measures of negotiations and reconciliation already taken by the sides which have failed;

f/ Full name of the Arbitrator whom the plaintiff selects from the list of Arbitrators of the Center of Economic Arbitration.

2. The plaintiff must send, enclosed with the request, the necessary documents to prove his/her request to the Center of Economic Arbitration.

Article 14.-

1. When sending in the request, the plaintiff must pay advance arbitration fee.

2. The arbitration fee shall be fixed by the Center of Economic Arbitration in accordance with the rates of fees stipulated by the Ministry of Finance and the Ministry of Justice.

3. The arbitration fee shall be borne by the losing side, unless otherwise decided by the parties concerned.

Article 15.-

1. Within seven days after receipt of the request, the Secretary of the Center of Economic Arbitration shall send a photocopy of the plaintiff's request and the list of Arbitrators of the Center of Economic Arbitration to the defendant.

2. Within the time-limit set by the Center of Economic Arbitration, the defendant must send his/her answer to the Center and the plaintiff. The answer must correspond with the request of the plaintiff.

The defendant can send, enclosed with the answer, other necessary documents to the Center of Economic Arbitration.

Article 16.-

In case the dispute is settled by a Council of Arbitrators, each side shall choose an Arbitrator; the two Arbitrators selected by the sides shall choose a third Arbitrator to act as Chairman of the Arbitrators' Council.

Within ten days after the selection of the second Arbitrator, if the two Arbitrators selected by the sides fail to select a third Arbitrator, then the President of the Center of Economic Arbitration shall appoint a third Arbitrator to act as Chairman of the Arbitrators' Council.

Article 17.- In case the sides agree that the dispute should be settled by one Arbitrator, but they cannot agree on the Arbitrator to be selected, then within seven days after the sides are informed of the selection of an Arbitrator by the Center, the President of the Center of Economic Arbitration shall appoint an Arbitrator to settle the dispute.

Article 18.-

1. An Arbitrator must be forced to refuse, or be requested by the sides to refuse, to perform his function, if there is evidence that he/she may not be impartial in settling the dispute.

2. Each side can refuse only the Arbitrator of its own choice.

3. The side, which requests a refusal, must send the request to the Center of Economic Arbitration.

4. The request for refusal must be considered and decided by the President of the Center of Economic Arbitration within seven days from the date when the request is received.

5. If the request for refusal is accepted, then another Arbitrator shall be selected or appointed as replacement, as stipulated in Article 16 and Article 17 of this Decree.

Article 19.- In case an Arbitrator cannot continue to take part in settling the dispute, another Arbitrator shall be selected or appointed as replacement, as stipulated in Article 16 and Article 17 of this Decree.

Article 20.-

1. The Arbitrators shall study the dossier and proceed with the necessary work to settle the dispute.

At the request of one side or both sides, or on their own initiative, the Arbitrators may listen to the views presented by the sides. The Arbitrators may also try to get to know the case from other people in the presence of the sides, or after informing the sides of such contacts.

2. At the sides' request, the Arbitrators may hold an examination.

3. When necessary, the Arbitrators may request the sides to supply explanations, evidence and other relevant documents.

Article 21.-

1. The time and venue for the session to settle the dispute shall be fixed by the Chairman of the Arbitrators' Council or by the Arbitrators, if the sides fail to reach agreement on it.

2. Invitations to the session to settle the dispute must be sent to the sides fifteen days before the opening of the session.

Article 22.-

1. The sides themselves can take part, or send their legitimate representatives to take part, in settling the dispute.

2. The sides can invite lawyers to defend their rights and their legitimate interests.

Article 23.-

1. At the sides' proposal or with their approval, the dispute may be settled in their absence.

2. In case one side or the sides are absent without a plausible excuse, the dispute may be settled on the basis of the available documents and evidence.

Article 24.-

1. Vietnamese is the language and script used in the process of settling the dispute.

2. The sides may request the Center of Economic Arbitration to invite interpreters, or they themselves may invite interpreters, with the approval of the Center of Economic Arbitration. The side who makes the request must defray the interpretation cost.

Article 25.- The settlement of the dispute shall be conducted on the basis of the contract's provisions and current law.

Article 26.- The Arbitrators' Council shall decide by majority vote.

Article 27.-

1. All developments of the session to settle the dispute must be recorded by the Secretary of the Center of Economic Arbitration.

2. The minutes must be signed by the Arbitrators and the Secretary.

3. The sides have the right to read the contents of the minutes. Any alterations or supplements to the minutes at the request of one side or the sides shall be decided by the Chairman of the Arbitrators' Council or by the Arbitrators.

Article 28.-

1. A decision made by the Arbitrators must have the following contents:

a/ Name of the Center of Arbitration;

b/ The venue and date of the decision;

c/ Full names of the Arbitrators who settle the dispute;

d/ Names and addresses of the sides;

e/ The contents of the dispute;

f/ The basis for making the decision, and the contents of the decision;

g/ The rates of arbitration fee the sides are liable to pay.

2. The Arbitrators' Council or the Arbitrators can decide to settle the dispute part by part, if they deem it reasonable.

3. An arbitrators' decision must have the signatures of all the Arbitrators.

4. After announcing an Arbitrators' decision, the Arbitrators' Council or the Arbitrators should not alter or supplement it, except when there are some miscalculations or misspelling, and they must notify the sides of it.

Article 29.-

1. An arbitrators' decision shall be announced to the sides immediately after the close of the session or some time afterwards, but not later than five days from the closing day.

2. An arbitrators' decision shall be sent to the sides within three days after the decision is made.

Article 30.- In the process of settling the dispute, if the sides reach agreement by negotiations, then the Arbitrators' Council or the Arbitrators can stop the case. The sides may request the President of the Center of Economic Arbitration to certify such an agreement in writing. This certification has the validity of an arbitrators' decision.

Article 31.- In case an arbitrators' decision is not observed by one side, the other side can request the competent People's Court to try it, in the same way as regarding an economic lawsuit.

Chapter IV

FINAL PROVISIONS

Article 32.- This Decree takes effect as from the date of its signing.

The Minister of Justice shall have to guide the implementation of this Decree.

Article 33.- The ministers, the heads of ministerial-level agencies, the heads of the agencies attached to the Government, and the presidents of the People's Committees of the provinces and cities directly under the Central Government shall have to implement this Decree.

On behalf of the Government

For the Prime Minister

Deputy Prime Minister

PHAN VAN KHAI